“Regional Centre for Energy”: New US Deal Set To Turn Around Lesotho’s Dependence on SA Electricity

• Lesotho has signed more than a billion dollar deal with US-based Convalt Energy to build a massive hydropower plant and an AI data centre under Project Kobong
• The deal could flip the script on Lesotho's energy situation completely, turning a country that imports power from South Africa into one that exports it
• The project is expected to be the largest foreign direct investment in Lesotho's history and could reshape how the two neighbouring countries rely on each other

Lesotho has signed a massive deal that could change its relationship with South Africa for good.

On 4 June 2026, the country's Ministry of Energy signed a $6.2 billion (R102,424,620,000.00 according to Wise Currency Converter) agreement with US-based Convalt Energy to develop Project Kobong, a 1,200-megawatt hydropower plant paired with an AI data centre.

The deal, worth 98 billion maloti, came after talks between King Letsie III and Richard Gephardt, a board member and shareholder at Convalt Energy, about Lesotho's ambitions to become a regional energy hub.

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Right now, Lesotho imports a large chunk of its electricity from South Africa's Eskom and Mozambique, because its own generation capacity falls well short of what the country needs.

In 2024 alone, Lesotho imported 438 gigawatt-hours out of the 970 gigawatt-hours it consumed. Project Kobong's planned capacity would be more than 10 times what Lesotho currently generates, which means it would not only cover local demand but potentially have surplus power to sell to neighbouring countries.

Lesotho's big energy shift

According to a report, the US Embassy in Maseru said the project could wipe out costly electricity imports entirely and position Lesotho as a power exporter in the region. It could also give the country a foothold in Africa's growing AI economy, since data centres need large and reliable electricity supplies to run. Details about the data centre's capacity and construction timeline have not been shared yet.

What makes this deal interesting is the broader relationship between Lesotho and South Africa. While Lesotho buys electricity from South Africa, it also supplies an estimated 60% of Johannesburg's water through the Lesotho Highlands Water Project.

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That water relationship is actually set to grow under Phase II of the same project. Project Kobong could mean Lesotho keeps supplying water to South Africa while no longer depending on it for power.

A new chapter for both countries

South Africa has been dealing with its own electricity troubles for years. Eskom's ageing infrastructure caused years of rolling blackouts, and although things have improved, outages linked to municipal infrastructure problems still happen in major cities.

For Lesotho, reducing that dependency could mean more stable and affordable electricity for its people going forward.

More on Lesotho and South Africa

• Briefly News recently reported on the Harambee Stars getting stranded in South Africa ahead of their friendlies against Lesotho, and the reason why left fans talking.
• Dramatic photos of Lesotho's Sani Pass completely buried in snow showed just how hard winter has hit the mountain kingdom this year.
• A Lesotho man boasting about his Starlink speeds had South Africans reacting in a way nobody expected.

Source: Briefly News